Due to its expenditure on war
materiel, Britain lacked
gold reserves and
U.S. dollars to pay for existing and future orders with Canadian industry. At the same time, following expansion, Canadian industry was dependent on British contracts and before the war had had a positive
balance of trade with the UK, but with the establishment of
Lend-Lease, the UK secured future orders with the US. The Billion Dollar Gift was given to the UK in January 1942, coupled with a
C$700 million non-interest bearing loan, both anticipated to last just over a year. It did not last until the end of 1942. It was replaced in May 1943 with the "War Appropriation (United Nations Mutual Aid) Act, 1943", which provided aid to the UK and the other
Allies and lasted until the end of the war. The magnitude of these contributions made them one of Canada's greatest contributions to the war. The two grants totaled over C$3 billion. Moreover, the Billion Dollar Gift triggered a strong negative reaction amongst Canadians, particularly in
Quebec. The rate at which the money was used was a key reason for the backlash, as was the lack of funding that was provided to the other nations in the Commonwealth. The aftermath of the Gift led Canada's future funding to assist the Allies with an alternative approach – one that focused on loaning material goods instead of money. most of which went to the
Commonwealth; some, like radars, also went to the U.S. Canada also loaned $1.2 billion on a long-term basis to Britain immediately after the war; these loans were fully repaid in late 2006. == See also ==